In today's extremely challenging business environment, many telecommunications carriers are measuring their success by the size and growth of their profit margins. As a result, carriers are under intense pressure to reduce or eliminate the major threats to these margins, which arise from revenue leakage, inaccurate inter-carrier billing, fraud, and churn. Carriers rely on analysis of terabytes of Call Detail Record (CDR) data to help them make business-critical decisions that will positively affect their bottom line. High-end data warehouses and powerful Business Intelligence (BI) solutions are thus becoming essential tools to help carriers meet profit goals. Analyzing and integrating in-depth data enables carriers to reduce revenue leakage and churn, mitigate fraud, optimize network usage and increase profits.
Interestingly, as mobile penetration is increasing and even approaching saturation, the focus of telecom BI is shifting from customer acquisition to customer retention. Estimates indicate that it is much cheaper to retain an existing customer than to acquire a new one. To maintain profitability, telecom service providers must control churn, that is, the loss of subscribers who switch from one carrier to another. In some instances, annual churn rates in the prepaid segment may average between a significant 50 to 70 percent. This implies that the operator must offer the right incentives, adopt the right marketing strategies, and place network assets appropriately to protect its customers.